5 ms·

I strongly doubt that this is going to have the effect that they want it to. It won't raise the taxes that they expect it to. It won't free up inventory. It w

I strongly doubt that this is going to have the effect that they want it to. It won't raise the taxes that they expect it to. It won't free up inventory. It will halt construction.

bix6 5mo ago
It’ll halt construction on luxury second homes? Wonderful!
- NickC25 5mo ago
  Seriously. Instead of using that land to build a $250 million penthouse Ken Griffin only spends 10 days a year in, they could probably build enough housing for 500+ middle class families.
  - Mallory_Ringess 5mo ago
    Who will build those homes? Who will pay for them? If it were a lucrative business to build those homes I'd assume someone would be building them but that does not seem to be the case. Why is this?
    - bix6 5mo ago
      Upvoting you for a great question! Not everything has to be lucrative amigo. The city could build multifamily housing and finance it through municipal bonds that pay a reasonable rate (tax free, booyakasha).
      - deleted 5mo ago
        [deleted]
    - cybercatgurrl 5mo ago
      hey better to keep new homes out of the rich than to have new homes at all! it’s still a win
galleywest200 5mo ago
Taxing second homes would halt construction? Plenty of people out there wish to own a first home, myself included.
- JuniperMesos 5mo ago
  How will that tax result in more houses existing?
  - stavros 5mo ago
    It will result in fewer second homes existing, therefore more first homes.
    - zeroonetwothree 5mo ago
      Perhaps. Homes are not zero sum though so it’s also possible there will be fewer first homes.
    - Cameri 5mo ago
      If you are just looking to massage the numbers so there are more first homes vs second homes percentage-wise without creating new first homes, then taxing luxury second homes may work. It has great potential to change the numbers on a spreadsheet. Decreasing the number of secondary homes for the wealthy _does not_ create more first homes people can realistically afford though.
  - lovich 5mo ago
    How will this tax result in less houses available for people with no primary home existing? It’s a tax on second homes. If a single person sells due to the tax and someone who had 0 homes previously, it’s spread the scarce housing stock. Not to say we shouldn’t build more but acting like a tax on multiple homes is going to make houses less available to everyone is ludicrous.
- busterarm 5mo ago
  The cost of construction in _New York City_ generally sets a floor as far as who can afford to pay for it. The per-apartment cost of construction in Manhattan is more than the retail price of my 3500sq ft house in near-rural South Carolina.
Daishiman 5mo ago
Those homes are built for money laundering anyway. Good riddance.
WarmWash 5mo ago
New York City rent exists at an equilibrium. The draw for people to move there is so intense, that any draw downs in rent are met with upticks in immigration. Adding housing stock in NYC is not like adding housing stock in Lawnsdale Ohio. Almost by definition you cannot out build the demand for housing.
- javanissen 5mo ago
  > Almost by definition you cannot out build the demand for housing. Would love to see some justification for this claim, which tacitly suggests that adding, say, 2M extra apartments over baseline would have zero effect on our housing market.
  - WarmWash 5mo ago
    2 million new apartments is doubling the number of apartments in NYC. I call water safe, but you may say it's a tacit admission that you could drink 5 gallons in an hour an experience zero effects. I wouldn't call that an honest rebuttal
    - javanissen 5mo ago
      There are 3.7M existing units in NYC, and I meant it as a 54% increase in overall housing units([0]), but that's on me for not clarifying that I did not mean "apartments" specifically and intended instead to say "housing units". It's still a very large number of units, and I think filtering effects from adding these in whatever configuration—studio apartments, large apartments, houses, mixed stock, etc.—would increase affordability across the market. > I call water safe, but you may say it's a tacit admission that you could drink 5 gallons in an hour an experience zero effects. I wouldn't call that an honest rebuttal I meant it as an honest rebuttal, and I largely disagree that your analogy applies. Humans obviously die from hyponatremia if they drink massive amounts of water: in your example, 5 gallons of water, which is 5X-10X someone's daily consumption in a short period of time. OK, I agree. I don't think the theoretical example of increasing the housing stock in NYC by 54% is likely to lead to serious negative effects, especially if it happens over a period of several years, because the city has astronomically high rents and even higher house prices [1]. I believe the culprit is primarily zoning and other restrictions on building, which I defended in another comment upthread. I do think radically relaxing zoning laws and regulations could theoretically lead to such an increase in supply within a period of, say, ten years. It is politically infeasible and would require basically every voter to understand that supply and demand pricing works in the housing market, which they don't. The reason I used that exact number—which was deliberately chosen to be large—is that I simply disagree with your claim, if I am understanding it correctly, and I felt a larger number would drive the point home more. I interpreted your claim as: adding marginal units to the housing market in NYC will not change the price of housing, relative to the universe in which we do not add more units, because there is alway a marginal person waiting in the wings who would like to move to NYC but hasn't yet. The thing is, what is actually preventing that marginal person from moving here? There is some vacancy here in NYC, even if it's low at 1.4%. Just adding one more unit with no change in price anywhere should not affect anything. In order for that person to actually go from "I am staying where I am" to "I am moving to NYC," the thing that has to change is the value of that apartment: it must breach the threshold at which point they'd move to NYC. I claim this predominantly happens through increased supply driving down price for a given unit compared to the universe where supply is held constant, which happens with basically any additional housing (via the filtering effect). If the increased supply held rents steady, there is no reason for that in-migration. This is the underlying mechanism by which all supply and demand works from my understanding; I don't see a reason why it should be different solely for housing in exactly one metropolitan area. Obviously individual decision making for a given person is not this simplistic, but at a population level I think the desirability vs. price calculation holds and the increase in supply decreasing price holds, which is why metro areas that have built a lot (e.g. Tokyo, Austin, Nashville) have even seen falling housing prices, while NYC and SF see rising rents. I picked a large number of units in my initial claim, but I basically do not think the logic changes for a small number of units either. Adding 100 units relative to baseline would nudge it down a smaller, but still meaningful amount. [0] https://rentguidelinesboard.cityofnewyork.us/wp-content/uploads/2025/05/2025-HSR.pdf https://rentguidelinesboard.cityofnewyork.us/wp-content/uplo... [1] https://www.apartments.com/rent-market-trends/new-york-ny/#:~:text=The%20cost%20of%20living%20in,and%2018.7%25%20more%20for%20transportation. https://www.apartments.com/rent-market-trends/new-york-ny/#:...
a_shovel 5mo ago
I don't think the demand for second homes worth over $5 million is a major driver of construction of new units in NYC.
- barnabee 5mo ago
  Are you sure? https://en.wikipedia.org/wiki/Billionaires%27_Row https://en.wikipedia.org/wiki/Billionaires%27_Row
BigTTYGothGF 5mo ago
> It will halt construction. Why would that be the case?
mbreese 5mo ago
I'm not sure it's that clear, and the taxes might not be the point. If this halts construction of second homes in the higher price ranges, then those construction crews will still need to do something. So, that might make it possible to find construction capacity for higher-density construction that otherwise wasn't available. Whether or not such a trickle-down effect will happen isn't guaranteed, but it's possible. It's also possible that no construction happens and we see a loss of jobs in the process. It's a complex market and this is definitely a risk.
linkregister 5mo ago
While rent control and exclusionary zoning do have measurable negative impacts on building, a vacancy tax on second homes is unlikely to have side effects beyond raising revenue. If a price-sensitive owner of a pied-à-terre is forced to sell or rent out the unit, then the policy is successful: the residence will be occupied. Ideally no second home tax would be implemented, and we could treat housing as an export. But due to intense local planning constraints, housing is scarce.

I strongly doubt that this is going to have the effect that they want it to. It won't raise the taxes that they expect it to. It won't free up inventory. It will halt construction.

bix6 5mo ago

It’ll halt construction on luxury second homes? Wonderful!

NickC25 5mo ago
Seriously. Instead of using that land to build a $250 million penthouse Ken Griffin only spends 10 days a year in, they could probably build enough housing for 500+ middle class families.
- Mallory_Ringess 5mo ago
  Who will build those homes? Who will pay for them? If it were a lucrative business to build those homes I'd assume someone would be building them but that does not seem to be the case. Why is this?
  - bix6 5mo ago
    Upvoting you for a great question! Not everything has to be lucrative amigo. The city could build multifamily housing and finance it through municipal bonds that pay a reasonable rate (tax free, booyakasha).
    - deleted 5mo ago
      [deleted]
  - cybercatgurrl 5mo ago
    hey better to keep new homes out of the rich than to have new homes at all! it’s still a win

galleywest200 5mo ago

Taxing second homes would halt construction? Plenty of people out there wish to own a first home, myself included.

JuniperMesos 5mo ago
How will that tax result in more houses existing?
- stavros 5mo ago
  It will result in fewer second homes existing, therefore more first homes.
  - zeroonetwothree 5mo ago
    Perhaps. Homes are not zero sum though so it’s also possible there will be fewer first homes.
  - Cameri 5mo ago
    If you are just looking to massage the numbers so there are more first homes vs second homes percentage-wise without creating new first homes, then taxing luxury second homes may work. It has great potential to change the numbers on a spreadsheet. Decreasing the number of secondary homes for the wealthy _does not_ create more first homes people can realistically afford though.
- lovich 5mo ago
  How will this tax result in less houses available for people with no primary home existing? It’s a tax on second homes. If a single person sells due to the tax and someone who had 0 homes previously, it’s spread the scarce housing stock. Not to say we shouldn’t build more but acting like a tax on multiple homes is going to make houses less available to everyone is ludicrous.
busterarm 5mo ago
The cost of construction in _New York City_ generally sets a floor as far as who can afford to pay for it. The per-apartment cost of construction in Manhattan is more than the retail price of my 3500sq ft house in near-rural South Carolina.

Daishiman 5mo ago

Those homes are built for money laundering anyway. Good riddance.

WarmWash 5mo ago

New York City rent exists at an equilibrium. The draw for people to move there is so intense, that any draw downs in rent are met with upticks in immigration. Adding housing stock in NYC is not like adding housing stock in Lawnsdale Ohio. Almost by definition you cannot out build the demand for housing.

javanissen 5mo ago
> Almost by definition you cannot out build the demand for housing. Would love to see some justification for this claim, which tacitly suggests that adding, say, 2M extra apartments over baseline would have zero effect on our housing market.
- WarmWash 5mo ago
  2 million new apartments is doubling the number of apartments in NYC. I call water safe, but you may say it's a tacit admission that you could drink 5 gallons in an hour an experience zero effects. I wouldn't call that an honest rebuttal
  - javanissen 5mo ago
    There are 3.7M existing units in NYC, and I meant it as a 54% increase in overall housing units([0]), but that's on me for not clarifying that I did not mean "apartments" specifically and intended instead to say "housing units". It's still a very large number of units, and I think filtering effects from adding these in whatever configuration—studio apartments, large apartments, houses, mixed stock, etc.—would increase affordability across the market. > I call water safe, but you may say it's a tacit admission that you could drink 5 gallons in an hour an experience zero effects. I wouldn't call that an honest rebuttal I meant it as an honest rebuttal, and I largely disagree that your analogy applies. Humans obviously die from hyponatremia if they drink massive amounts of water: in your example, 5 gallons of water, which is 5X-10X someone's daily consumption in a short period of time. OK, I agree. I don't think the theoretical example of increasing the housing stock in NYC by 54% is likely to lead to serious negative effects, especially if it happens over a period of several years, because the city has astronomically high rents and even higher house prices [1]. I believe the culprit is primarily zoning and other restrictions on building, which I defended in another comment upthread. I do think radically relaxing zoning laws and regulations could theoretically lead to such an increase in supply within a period of, say, ten years. It is politically infeasible and would require basically every voter to understand that supply and demand pricing works in the housing market, which they don't. The reason I used that exact number—which was deliberately chosen to be large—is that I simply disagree with your claim, if I am understanding it correctly, and I felt a larger number would drive the point home more. I interpreted your claim as: adding marginal units to the housing market in NYC will not change the price of housing, relative to the universe in which we do not add more units, because there is alway a marginal person waiting in the wings who would like to move to NYC but hasn't yet. The thing is, what is actually preventing that marginal person from moving here? There is some vacancy here in NYC, even if it's low at 1.4%. Just adding one more unit with no change in price anywhere should not affect anything. In order for that person to actually go from "I am staying where I am" to "I am moving to NYC," the thing that has to change is the value of that apartment: it must breach the threshold at which point they'd move to NYC. I claim this predominantly happens through increased supply driving down price for a given unit compared to the universe where supply is held constant, which happens with basically any additional housing (via the filtering effect). If the increased supply held rents steady, there is no reason for that in-migration. This is the underlying mechanism by which all supply and demand works from my understanding; I don't see a reason why it should be different solely for housing in exactly one metropolitan area. Obviously individual decision making for a given person is not this simplistic, but at a population level I think the desirability vs. price calculation holds and the increase in supply decreasing price holds, which is why metro areas that have built a lot (e.g. Tokyo, Austin, Nashville) have even seen falling housing prices, while NYC and SF see rising rents. I picked a large number of units in my initial claim, but I basically do not think the logic changes for a small number of units either. Adding 100 units relative to baseline would nudge it down a smaller, but still meaningful amount. [0] https://rentguidelinesboard.cityofnewyork.us/wp-content/uploads/2025/05/2025-HSR.pdf https://rentguidelinesboard.cityofnewyork.us/wp-content/uplo... [1] https://www.apartments.com/rent-market-trends/new-york-ny/#:~:text=The%20cost%20of%20living%20in,and%2018.7%25%20more%20for%20transportation. https://www.apartments.com/rent-market-trends/new-york-ny/#:...

a_shovel 5mo ago

I don't think the demand for second homes worth over $5 million is a major driver of construction of new units in NYC.

barnabee 5mo ago
Are you sure? https://en.wikipedia.org/wiki/Billionaires%27_Row https://en.wikipedia.org/wiki/Billionaires%27_Row

BigTTYGothGF 5mo ago

> It will halt construction. Why would that be the case?

mbreese 5mo ago

I'm not sure it's that clear, and the taxes might not be the point. If this halts construction of second homes in the higher price ranges, then those construction crews will still need to do something. So, that might make it possible to find construction capacity for higher-density construction that otherwise wasn't available. Whether or not such a trickle-down effect will happen isn't guaranteed, but it's possible. It's also possible that no construction happens and we see a loss of jobs in the process. It's a complex market and this is definitely a risk.

linkregister 5mo ago

While rent control and exclusionary zoning do have measurable negative impacts on building, a vacancy tax on second homes is unlikely to have side effects beyond raising revenue. If a price-sensitive owner of a pied-à-terre is forced to sell or rent out the unit, then the policy is successful: the residence will be occupied. Ideally no second home tax would be implemented, and we could treat housing as an export. But due to intense local planning constraints, housing is scarce.